Chaos at the Probate Registry…

…As delays to issuing a Grant of Probate continue

Changes at Probate Registry cause substantial delays with grants of probate

When someone dies a Grant of Probate is required for the majority of estates, depending on the type of assets. The Grant of Probate provides authority to the Personal Representatives of an estate to deal with interests in land, shareholdings, investments, some insurance policies and death benefits and to access bank accounts with a balance above a certain threshold.

In recent months, there have been substantial delays with the Probate Registry processing applications for a Grant of Probate, currently estimated to be between 10 - 12 weeks from receipt. There are also severe delays responding (if at all) to routine correspondence and an apparent inability to speak to Registry staff by telephone. This has led to a large number of bereaved families trying to sort out the affairs of a deceased relative suffering from the stress, inconvenience and cost as a result of these delays.

A number of reasons for this situation have been cited and, unfortunately, there are a number of changes to the process proposed by the Government which are likely to have compounded the delays.

New System

The first cause of delay was a move to a new processing system, involving partly outsourced services. There have been teething issues, including running out of the required hologram grant paper.  

The Government had also introduced the ability to make applications for a Grant of Probate online and there were likely teething issues with this too.

Fee Increase

Around the same time, the Government had proposed a significant rise in the fees payable, in addition to any inheritance tax due, which for some estates would increase the fee from £155 to £6,000. The fee payable is on a sliding scale depending on the value of the estate, despite the work required being the same regardless of the value. This increase was also proposed in spite of the Probate Registry service seemingly funding itself adequately. Inevitably, the proposed increase, lead to an increased number of applications, which were hurried though in order to mitigate a potentially significant cost to the estate. The increase in fees has been shelved for the time being, but could come into force with 21 days notice, despite protestations that it is essentially a tax and should therefore submit to the full parliamentary process.

Closure of District Registries

It seems the Government is now planning to move away from the current system of District Probate Registries to just one central Registry, seeking to close or merge District Registries in the process. Ipswich District Probate Registry seems to be no longer operating, with all post being diverted to Newcastle. The future in this regard is still very uncertain but is very likely to cause yet further delays as services and staff are moved around. It then remains to be seen whether the remaining Registry office will be able to cope with the demand that is currently spread across the country.

HMRC Delays

There are also noticeable delays with HM Revenue & Customs who are, in a number of cases, required to confirm receipt of Inheritance Tax due or confirm that it is not payable before a Grant can be released. HMRC's target is to provide the required receipt within ten working days but has been noticeably longer recently. This only compounds the delays further. Whilst the Registry may accept applications in advance of HMRC approval, they do not start to progress them until they have given approval.

Consequences

Unfortunately, there is little that can be done for those waiting or needing to apply for Grants. The process is mandatory before certain assets can be dealt with. The significant delay in obtaining the necessary authority to deal with those assets can have significant consequences.

Without a Grant, land is unable to be sold or transferred to a beneficiary. A beneficiary (often a surviving spouse or children) may be unable to access the rent from a rental property or otherwise release the capital. If a property sale had commenced prior to death, it is likely this will be held up or aborted. Some bank accounts will be entirely frozen until a Grant is produced, even if the Will clearly states who is to inherit.  Again, surviving spouses and children can be left without access to the funds they need and the salary or pension of a loved one that they relied on will also have stopped.

Most banks will arrange to pay the funeral bill on production of an invoice and arrange payment of any IHT, provided there are sufficient funds in the accounts. A bank is, however, unlikely to settle any other liabilities and will not provide funds to meet ongoing rent/mortgage payments etc. This can leave a spouse or others dependent on the deceased with significant financial issues whilst they wait for the Grant.

If an account is under a set threshold (seemingly set by each bank) then the bank may close the account and release the funds on sight of a death certificate. Some banks have a policy to release quite a substantial amount, sometimes in excess of £40,000. That can, however, cause problems, as funds have been known to be released to someone who is not an Executor.

Following the death of a loved one, the last thing people need is stress and financial difficulties. A potential 12+ week delay is therefore very serious. The Government needs to get a grip of the situation before making fundamental, sweeping changes and proposing to dramatically increase fees, especially when there had been very little wrong with the functioning of the Probate service.

For further information and legal advice concerning a Grant of Probate or managing an estate when someone dies please contact our Wills, Trusts and Probate team on 01733 882800 or email info@hcsolicitors.co.uk.

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This article has been prepared for general interest and information purposes only; it does not constitute legal advice and should not be relied on as such. While all possible care has been taken in the preparation of this article, no responsibility for the accuracy and/or correctness of the information and commentary set out in the article, or for any consequences of relying on it, is assumed or accepted by the firm or the authors.